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Uniting Pharma With Business Ethics: A Bridge Too Far?

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Operating ethically not only is the right thing to do but also is fundamental to success in business. Poor governance and poor ethical business practices can lead to fines, public scrutiny and distrust – overshadowing good performance, destroying reputation, and undermining the morale and engagement of employees. …We must act in ways that build and maintain the trust of patients, healthcare professionals, governments and society. This was articulated in the Novartis Corporate Responsibility Report 2017, highlighting how important it is to unite pharma operations with business ethics for each company. But is it happening in reality?

The same question haunts yet again with the announcement of a new Code of Marketing Practice by the International Federation of Pharmaceutical Manufacturers and Associations’ (IFPMA),effective January 2019. The pronouncement prescribes ‘a global ban on gifts and promotional aids for prescription drugs wherever the association’s member companies operate.’

However, the overall scenario gets more complex to comprehend, when on January 03, 2019  Bloomberg Law reported: ‘The change is causing concern among both U.S.-based and multinational companies like Astra Zeneca, Bristol-Myers Squib, Johnson & Johnson, and Pfizer Inc. about how to balance appropriate business behavior with respect for cultural norms in other countries.’ Interestingly, the IFPMA membership virtually covers all MNC drug companies, operating across the world. Thus, any concern on its implementation, especiallyamong some of the bigger names, raises more questions than answers about its effectiveness. What exactly has been the outcome of all such actions being taken, especially by the multinational pharma industry associations, from time to time. Have the patients been benefited – at all?

Keeping this recent development as the backdrop, I shall try to gauge in this article, is the bridge still too far to mitigate the widening gap between overall pharma operations and the standard of business ethics -voluntary code of practices of pharma associations notwithstanding?

Why pharma ‘business-practices’ and ‘business-ethics’ are so important?

Before charting onto the sensitive areas of ‘business practices’ and ‘business ethics’, let me recapitulate the meaning of these two terminologies to fathom why these are so important in pharma to protect patient health interest.

  • Business practice is defined as a method, procedure, process, or rule employed or followed by a company in pursuit of achieving its objectives. Itmay also refer to these collectively.
  • Similarly, Business ethics is defined as a form of professional ethics that examines the ethical and moral principles and problems that arise in a business environment. It applies to all aspects of business conduct on behalf of both individuals and the entire company.

Thus, ethical business policies and practices for pharma industry, when worked out both by an industry association or an individual company, aims at addressing potentially controversial issues, such as corporate governance, insider trading, bribery, discrimination, corporate responsibility and fiduciary responsibilities.

Ironically, despite well-hyped announcements of voluntary codes of practices from time to time, no commensurate changes in patients’ health interest are visible in real life. Thus, the very relevance of such edicts is now being seriously questioned by many.

What do reports reflect on ongoing pharma business practices?

To get an idea in this area, let me quote below from three reports, out of which one is specifically on the Indian scenario, which has not changed much even today:

“The interaction between physicians and medical representatives (MRs) through gift offering is a common cause for conflicts of interest for physicians that negatively influence pre- scribing behaviors of physicians throughout the world.” This was articulated in an article titled, “Gift Acceptance and Its Effect on Prescribing Behavior among Iraqi Specialist Physicians”, published by Scientific Research Publishing (SCIRP) in June 2014.

A couple of years before that, on September 07, 2012, Reuters also published an article with the headline: “In India, gift-giving drives drug makers’ marketing.” Thereafter, many similar articles were published in various newspapers and magazines, possibly to trigger remedial action by the regulators in the country.

Very recently, on January 18, 2019, The New York Times (NYT) came out with a mind boggling headline – “Study Links Drug Maker Gifts for Doctors to More Overdose Deaths.” Elaborating on this JAMA study, the NYT wrote: “Counties where the doctors got more meals, trips and consulting fees from opioid makers had higher overdose deaths involving prescription opioids.”

The point I want to drive home here is that freebies in the form of gifts, travel to exotic places with free meals and stay, fees of various types clubbed under a mysterious nomenclature ‘consulting fees’, purported to influence doctor’s prescribing behavior, are now rampant. These are adversely impacting patients, as they are often compelled to buy high-priced drugs, unnecessary drugs, including antibiotics, sedatives and opioids, to name a few.

Are big pharma companies following the codes – both in letter and spirit?

The doubt that surfaces, are these changes just for displaying to the stakeholders how well and with stringent measures, drug companies are self-regulating themselves, on an ongoing basis? Before jumping to any conclusion, let us try to make out whether, at least the big pharma players are following these codes in both letter and spirit.

To establish the point, instead of providing a long list of large pharma settlements with governments for various malpractices, I shall cite just the following two relatively recent ‘novel’ examples related two top global pharma companies, for you to have your own inferences.

  • The first one is related to reports that flashed across the world in May 2018 related to Novartis. One such article described, “Congress demands info from Novartis about its USD 1.2m in outflows to Michael Cohen, just as it was negotiating payments for its cancer drug.” The report further elaborated, Novartis’ USD 1.2 million payment was made in the shell company of Michael Cohen, President Donald Trump’s personal lawyer and so-called ‘fixer’.
  • The second one is the September 13, 2018 report of The New York Times. It revealed: ‘Dr. José Baselga, the chief medical officer of Memorial Sloan Kettering Cancer Center, resigned on Thursday amid reports that he had failed to disclose millions of dollars in payments from health care companies in dozens of research articles.”

The report also stated: “Dr. Baselga, a prominent figure in the world of cancer research, omitted his financial ties to companies like the Swiss drugmaker Roche and several small biotech startups in prestigious medical publications like The New England Journal of Medicine and The Lancet. He also failed to disclose any company affiliations in articles he published in the journal Cancer Discovery, for which he serves as one of two editors in chief.”

Indian companies aren’t trailing far behind, either:

Many Indian companies are, apparently, sailing on the same boat. Let me illustrate this point by citing an example related to India’s top ranked domestic pharma player.

What it said: Way back on November 13, 2010, Sun Pharmain a communication expressed its concern by saying: ‘Over four decades since Independence, the government nurtured a largely self-sufficient pharma industry. But the entry of MNCs is putting most drugs beyond the reach of millions.’

The communique further added: ‘Even as the domestic industry begins to feel the heat of an unprotected market, public health experts are examining why drug prices in India are higher than in Sri Lanka, which imports most of its drugs. The MNC takeover raises the specter of an MNC-dominated pharma sector selling drugs at un-affordable prices, a throw ‘back to the scenario just after Independence, which the government painstakingly changed over four decades. Are we setting the clock back on the country’s health security?’

The reality thereafter: It’s a different story that today, the same Sun Pharma, despite alleged ‘high price drugs of MNCs’, occupies the top ranking in the Indian pharmaceutical market. Be that as it may, the point to note that the same company is now facing similar charges from other countries, almost a decade after. On March 2017, a media report came with a headline: ‘Sun Pharma, Mylan face price fixing probe in US.’

Incidentally,the company is mired with allegation on governance related issues, as well. A media report dated November 20, 2018 carried a headline: ‘Governance cloud over Sun Pharma, stock at 6-month low.’ This example is quite relevant to this discussion, as well, for its link with ethical business practices, as discussed earlier.

Additionally, class-action lawsuits in the United States for alleged business malpractices, including ‘pay for delay conspiracies’, against Indian pharma companies are also on the rise – Sun Pharma and Dr. Reddy’s top the list in terms of those who face most class-action litigation, reported a leading Indian business daily on September 02, 2017.

Pharma malpractices continue, DOP is still to make UCPMP mandatory: 

In this quagmire, where self-regulation doesn’t work, the government usually steps in, as happened in the United States and Europe. Whereas, in India, no decisive government action is yet visible to curb this menace, especially for protection of patients’ health interest. Let me try to illustrate this point with the following chronology of four key events:

  • On May 08, 2012, the Parliamentary Standing in its 58th Report, strongly indicted the DoP for not taking any tangible action in this regard to contain ‘huge promotional costs and the resultant add-on impact on medicine prices’.
  • Ultimately, effective January 01, 2015, the Department of Pharmaceuticals (DOP) put in place the Uniform Code of Pharmaceutical Marketing Practices (UCPMP) for voluntary implementation, despite knowing it has not worked anywhere in that format.
  • When voluntary UCPMP did not work, on September 20, 2016, the then secretary of the DoP reportedly said, the mandatory “UCPMP is in the last leg of clearance with the government. The draft guidance has incorporated suggestions of the pharma industry and other stakeholders.”
  • After another year passed by, on April 16, 2018, a news report reconfirmed: ‘4 years on, code to punish pharma firms for bribing doctors still in works.’ Its status remains unchanged till date.

Conclusion:

Even after Prime Minister Modi’s comment on April 2018 regarding the alleged nexus between doctors and pharmaceutical firms and doctors attending conferences abroad to promote these companies, decision paralysis of DOP continues on this important issue.

Pharma companies continue practicing what they deem necessary to further their business interest, alongside, of course, announcing their new and newer voluntary codes of practices. But, patients keep suffering, apparently for the apathy of the DOP to curb such malpractices forthwith.

Coming back to where I started from, when the malice is so deeply rooted, would any global ban ‘brand-reminders’, such as gifts, even if implemented religiously, work? Thus, the doubt lingers, for uniting pharma operations with corporate business ethics is the bridge still too far?

By: Tapan J. Ray

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.

Gamification in Pharma: Creates Engaging Patient Experience For Better Results

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On January 03, 2019, media reports flashed – “A video game-based ‘digital medicine’ tool can help reduce symptoms in children with autism spectrum disorder (ASD) and attention/deficit-hyperactivity disorder (ADHD).” This study was published in the Journal of Autism and Developmental Disorders, confirming the feasibility and safety of the tool called Project: EVO, which delivers sensory and motor stimuli through an action video game experience.

This initiative reconfirms that technology is becoming a great enabler to provide integrated, comprehensive and cost effective approach in treating many diseases, particularly with ‘Digital Medicine.’ The above report on ‘Project EVO’ is an example of application of the concept of ‘gamification’ in digital medicine. Many consider ‘gamification’ as a game changer to create an engaging patient experience with added value. It makes patients getting involved in the disease-treatment process, especially for effective self-management of chronic disorders.

I shall focus on this area in today’s article, giving examples wherever available. However, let me start by recapitulating what is ‘gamification’ in the pharma industry.

Gamification: 

The Oxford dictionary defines ‘gamification’ as: ‘The application of typical elements of game playing (e.g. point scoring, competition with others, rules of play) to other areas of activity, typically as an online marketing technique to encourage engagement with a product or service.’ It further adds, ‘gamification is exciting because it promises to make the hard stuff in life fun.’

‘Gamification’ is assuming increasing importance, with disruptive digital innovations gradually becoming game changers in the pharma business. This is mainly because, it can deliver to a specific group of patients, doctors or other stakeholders exactly what they look for – with precision.

I suggested in my article, published in this blog on January 07, 2019 that pharma companies should facilitate self-management of chronicailments,not just for better outcomes, but also for improving the quality of patient engagement. To achieve this objective,‘gamification’ could play a remarkable role-such as disease awareness and prevention and when afflicted its desirable self-management. This has the potential to create a win-win situation between patients and a drug company.

This is so important, as ‘the old paradigm of the paternalistic model of medicine is now transforming into an equal level partnership between patients and professionals, aided and augmented by disruptive technologies. This comment was made in a study titled, ‘Digital health is a cultural transformation of traditional health care,’ published in mHealth on September 14, 2017.

‘Patient-doctor partnership is critical in the new paradigm:

One of the major ways to develop a partnership between the treating doctors along with the product/service providing pharma companies and patients is through mutually beneficial ‘patient engagement’ programs with added value.

That such programs can create a unique patient experience of better outcomes at a lesser cost, has already been established by a number of credible research studies. Taking a cue from quantum benefits that this initiative provides, many pharma companies are now making ‘patient engagement’ strategy as an integral part of their overall market access program, including the process of branding.

What does an effective patient engagement strategy involve?

An article titled, ‘Patient Engagement: A Key Element in Pharmaceutical Marketing Strategy,’ published in the IgeaHub on May 29, 2016 defines ‘patient engagement’ as a concept that combines a patient’s knowledge, skills, ability and willingness to manage his own health and care with interventions designed to increase activation and promote positive patient behaviors. This measure also involves offering relevant services to patients.

To assess the opportunity of patient services in the pharma industry, Accenture conducted a survey titled, ‘Pharma’s Growing Opportunity in Patient Services’, on 200+ pharma patient services executives, covering seven therapeutic areas – heart, lungs, brain, immune systems, bones, hormone/metabolism, and cancer. The study concluded,the future of patient services that requires patient engagement, is bright. It elaborated by saying, this approach offers pharmaceutical companies a tremendous opportunity – for those willing to invest in the right places and let patients know about them in the right way.

To move in this direction, ‘gamification’ is an efficient way for the pharma companies to follow. Let us see below how does ‘gamification’ work on the ground.

How does ‘gamification’ work?

According to the findings of Innovatemedtec, ‘gamification’ with health apps typically works in the following three ways:

  • Allowing users to share progress and results with their friends or other users of the service, creating a competitive spirit to elicit more or better use of the specific health app service.
  • Giving virtual gifts, such as badges, medals, stars during each stage of progress, generating a sense of achievement for greater patient motivation levels in disease monitoring and management.
  • Advanced medical health applications can provide real-time biofeedback with built-in sensors. Or using a storytelling approach and explaining health literature related to diagnoses, medical procedures and patient behavior.

Thus, the primary reasons for introducing ‘gamification’ in the pharma industry would be to improve the disease awareness and increasing patients’ motivation for self-management for mutual benefits.

Improves disease awareness and motivation for self-management:

The precise rationale for ‘gamification’ in the pharma industry was nicely articulated in the ‘M.Sc. Thesis titled, ‘Gamification in the Pharmaceutical Industry – Exploring how European Pharmaceutical Organizations can build and use Gamified Mobile Applications to Improve Relations with Patients.’ This was written by Nanna Birkedal and jointly delivered by the University of Stirling and Lund University.

It highlighted: “Patients and industry experts both argue that awareness is important; constant reminders about healthy habits are pivotal for an improved lifestyle. Patients furthermore need to be motivated to act upon this and actively implement the required lifestyle changes. If pharmaceutical organizations succeed in helping the patients with overcoming challenges related to their illness by motivating them to enact the needed lifestyle changes, it will increase the perceived trust towards their brand and thereby strengthen their relationship with the patients. This research argues that digital gamification is suited for this purpose, hence why it may be advantageous for organizations to incorporate digital gamification …”

Why and how to motivate patients for self-management of chronic disease?

As I said before, after proper diagnosis of a chronic ailment and charting out a medical treatment pathway, self-management of the disease by patients plays a critical role. Thus, the question arises, how to motivate patients and more importantly, keep patients motivated for engaging in self-management of such nature.

There is also a need for continuous improvement of the ‘gamification’ process for a long-term engagement of patients, leading to progressively better outcomes. Many examples of success with ‘gamification’ are available for chronic diseases, such as diabetes.

One of the metrics used in ‘gamification’ to help diabetic patients stick with a digital health platform, making it a higher priority in their daily lives, is to provide useful timely information on their disease condition. This metric may include informing the user about some tangible changes in their health risks due to the disease. For example: “Over the last month your effective glucose has reduced the risk of losing your eyesight by 10 percent.” Accordingly, the patients may earn points or badges for using the app and accomplishing certain important tasks.

In this way, gamification can immensely help self-management through behavioral changes, improving disease outcomes. As Healthcare in America also reiterates: ‘There is nothing more motivating than knowing your health is improving in real time.’

Another study, and two examples of ‘gamification’ in pharma:

Another study titled, ‘Gamification: Applications for Health Promotion And Health Information Technology Engagement’, published by ResearchGate arrived at an interesting conclusion. It reiterated: ‘Game-based approaches (gamification) can provide ideal strategies for health promotion, prevention, and self-management of chronic conditions. However, there is a need to clearly define components and uses of gamification in healthcare for increased patient engagement in health information technology.’

Elaborating the point further, the authors emphasized that many health/physical activity apps provide feedback in a clear and concise manner and in a variety of formats (e.g., graphs, text or icons). The available option to share the feedbacks on social networking sites allows for further engagement by individuals and adds additional motivation and encouragement in attaining users’ goals. However, it recommends more studies to explore and identify the suitability of ‘gamification’ for health in clinical settings.

There have been several instances of gamification efforts health care with powerful effects. Let me cite just two interesting illustrations from mobihealthnews, as follows:

Conclusion:

As available from various literature, such as Healthcare in America, there are enough well-verified testimony, indicating that patients are motivated by gamified elements.

Consequently, some major global pharmaceutical companies have started testing the water. For example, the Media Release of Roche dated June 30, 2017 announces, the company has acquired mySugr - an Austrian startup that offers gamified solutions for diabetes management in a fun way, both for children and adults. It, reportedly, has more than a million registered users in 52 countries and is available in 13 different languages. Post-acquisition, it will be an integral part of Roche’s new patient-centered digital health services in diabetes care.

Hence, ‘gamification’ in pharma carries potential to be a win-win strategy in creating engaging, motivating and a unique patient experience in self-management of chronic diseases, for better outcomes.

By: Tapan J. Ray    

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.

Providing Unique Patient Experience – A New Brand Differentiator

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“Pharma industry, including the patients in India are so different from other countries. Thus, any strategic shift from conventional pharma brand marketing approach – going beyond doctors, won’t be necessary.”

The above mindset is interesting and may well hold good in a static business environment. But, will it remain so when ‘information enabled’ consumer behavior is fast-changing?

“Shall cross the bridge when we come to it” – is another common viewpoint of pharma marketers.

Many might have also noted that such outlooks are not of just a few industry greenhorns. A wide spectrum of, mostly industry-inbred marketers – including some die-hard trainers too, subscribe to it – very strongly.

Consequently, the age-old pharma marketing mold remains intact. Not much effort is seen around to reap a rich harvest out of the new challenge of change, proactively. The Juggernaut keeps moving, unhindered, despite several storm signals.

Against this backdrop, let me discuss some recent well-researched studies in the related field. This is basically to understand how some global pharma companies are taking note of the new expectations of patients and taking pragmatic and proactive measures to create a unique ‘patient experience’ with their drugs.

Simultaneously, I shall try to explore briefly how these drug companies are shaping themselves up to derive the first-mover advantage, honing a cutting edge in the market place. This is quite unlike what we generally experience in India.

As I look around:

When I look around with a modest data mining, I get increasingly convinced that the quality of mind of pharma marketers in India needs to undergo a significant change in the forthcoming years. This is because, slowly but surely, value creation to provide unique ‘patient experience’ in a disease treatment process, will become a critical differentiator in the pharma marketing ball game. Taking prime mover advantage, by shaping up the change proactively for excellence, and not by following the process reactively for survival, would separate the men from the boys in India, as well.

Patient experience – a key differentiator:

A recent report titled, “2017 Digital Trends in Healthcare and Pharma”, was published by Econsultancy in association with Adobe. This study is based on a sample of 497 respondents working in the healthcare and pharma sector who were among more than 14,000 digital marketing and eCommerce professionals from all sectors. The participants were from countries across EMEA, North America and Asia Pacific, including India.

Regarding the emerging scenario, the paper focuses mainly on the following areas:

  • Pharma companies will sharpen focus on the customer experience to differentiate themselves from their competitors.
  • ‘The internet of things (IoT)’ – the rapidly growing Internet based network of interconnected everyday use computing devices that are able to exchange data using embedded sensors, has opened new vistas of opportunity in the pharma business. Drug players consider it as the most exciting prospect for 2020.
  • Virtual Reality (VR) and Augmented Reality (AR) have started filling critical gaps in pharma and healthcare technologies and systems. Their uses now range from training doctors in operating techniques to gamifying patient treatment plans. Over 26 percent of respondents in the study see the potential in VR and AR as the most exciting prospect for 2020.

Commensurate digital transformation of pharma industry is, therefore, essential.

Prompts a shift from marketing drugs to marketing outcomes:

The above study also well underscores a major shift – from ‘marketing drugs and treatments’ – to ‘marketing outcome-based approaches and tools’, both for prevention and treatment of illnesses. This shift has already begun, though many Indian pharma marketers prefer clinging on to their belief – ‘Indian pharma market and the patients are different.’

If it still continues, there could possibly be a significant business impact in the longer-term future.

Global companies have sensed this change:

Realizing that providing a unique experience to patients during the treatment process will be a key differentiator, some global companies have already started acting. In this article I shall highlight only one recent example that was reported in March 01, 2018.

Reuters in an article on that day titled, “Big pharma, big data: why drugmakers want your health records,” reported this new trend. It wrote, pharma players are now racing to scoop up patient health records and strike deals with technology companies as big data analytics start to unlock a trove of information about how medicines perform in the real world. This is critical, I reckon, to provide a unique treatment experience to the patients.

A recent example:

Vindicating the point that with effective leverage of this powerful tool, drug manufacturers can offer unique value of their medicines to patients, on February 15, 2018, by a Media Release, Roche announced, it will ‘acquire Flatiron Health to accelerate industry-wide development and delivery of breakthrough medicines for patients with cancer.’ Roche acquired Flatiron Health for USD 1.9 billion.

New York based Flatiron Health – a privately held healthcare technology and services company is a market leader in oncology-specific electronic health record (EHR) software, besides the curation and development of real-world evidence for cancer research.

“There’s an opportunity for us to have a strategic advantage by bringing together diagnostics and pharma with the data management. This triangle is almost impossible for anybody else to copy,” said Roche’s Chief Executive Severin Schwan, as reported in a December interview. He also believes, “data is the next frontier for drugmakers.”

Conclusion:

Several global pharma companies have now recognized that providing unique patient experience will ultimately be one of the key differentiators in the pharma marketing ballgame.

Alongside, especially in many developed countries, the drug price regulators are focusing more on outcomes-based treatment. Health insurance companies too, have started looking for ‘value-based pricing,’ even for innovative patented medicines.

Accordingly, going beyond the product marketing, many drug companies plan to focus more on outcomes-based marketing. In tandem, they are trying to give shape to a new form of patient expectation in the disease prevention and treatment value chain, together with managing patient expectations.

Such initiatives necessitate increasing use advanced data analytics by the pharma marketers to track overall ‘patient experience’ – against various parameters of a drug’s effectiveness, safety and side-effects. This would also help immensely in the customized content development for ‘outcomes-based marketing’ with a win-win intent.

Providing unique ‘patient experience’ is emerging as a new normal and a critical brand differentiator in the global marketing arena. It will, therefore, be interesting to track how long the current belief – ‘Pharma industry and the patients in India are so different from other countries’, can hold its root on the ground, firmly. Or perhaps will continue till it becomes a necessity for the very survival of the business.

By: Tapan J. Ray   

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.

Improving Patient Access To Biosimilar Drugs: Two Key Barriers

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Novel biologic medicines have unlocked a new frontier offering more effective treatment for a host of chronic and life-threatening diseases, such as varieties of cancer, rheumatoid arthritis and diabetes, to name just a few. However, these drugs being hugely expensive, many patients do not have any access, or adequate access, to them. According to the Biosimilar Council of GPhA, only 50 percent of severe Rheumatoid Arthritis patients receive biologic medicines, even in the United States, Europe and Japan, leave aside India.

Realizing the gravity of this situation, a need to develop high quality, reasonably affordable and similar to original biologic brands, was felt about ten years ago. These were intended to be launched immediately after patent expiry of the original biologic. Such medicines are termed as biosimilar drugs. It is worth noting, even biosimilar drug development involves complex manufacturing processes and handling, while dealing with derivatives of highly sensitive living organisms.

The regulatory approval process of these drugs is also very stringent, which demands robust clinical data, demonstrating high similarity, both in effectiveness and safety profile, to original biologic brands, known as the reference product. The clinical data requirements for all new biosimilars include data on patients switching from the originator’s brand, and also between other biosimilars. Clinical evidences such as these, are expected to provide enough confidence to physicians for use of these products.

An article published in the PharmaTimes magazine in January 2016, reiterated that over the last couple of years, a wealth of supporting data has been published in medical journals and presented at global congresses, including real-world data of patients who have been switched to the new drug from the originator. This has led to a positive change in physician and patient attitudes towards biosimilars.

The good news is, besides many other regulated markets, as of May 2017, five biosimilar drugs have been approved even by the US-FDA, and several others are in the pipeline of its approval process.

That said, in this article I shall mainly focus on the two key barriers for improving patient access to biosimilar drugs, as I see it.

Two major barriers and their impact:

As I see it, there appear to be the following two key barriers for more affordable biosimilar drugs coming into the market, improving patients’ access to these important biologic medicines:

  • The first barrier involves fierce legal resistance from the original biologic manufacturers of the world, on various grounds, resisting entry of biosimilar varieties of their respective brands. This compels the biosimilar drug manufacturers incurring heavy expenditure on litigation, adding avoidable cost. A glimpse of this saga, we are ‘privy’ to witness even in India, while following Roche versus Biocon and Mylan case related to ‘Trastuzumab’. This barrier is one of the most basic types, that delays biosimilar drug entry depriving many new patients to have access to lower priced effective biologic for the treatment of serious diseases.
  • The other major barrier that exists today, involves ‘interchangeability’ of original biologic with biosimilar drugs. It simple means that in addition to being highly similar, a biosimilar drug manufacturer would require producing indisputable clinical evidence that it gives the same result for any given patient just as the original biologic. We shall discuss the reason behind this regulatory requirement later in this article. However, this is an expensive process, and the absence of it creates a barrier, making the physicians hesitant to switch all those existing patients who are on expensive original biologic drugs with less expensive available biosimilar alternatives.

The first or the initial barrier:

The first or the initial barrier predominantly involves patent related legal disputes, that can only be settled in a court of law and after incurring heavy expenditure towards litigation. Provided, of course, the dispute is not mutually resolved, or the law makers do not amend the law.

An interesting case in India:

Interestingly, in India, a similar dispute has knocked the doors of both the high court and the Competition Commission of India (CCI). From a common man’s perspective, it appears to me that the laws under which these two institutions will approach this specific issue are seemingly conflicting in nature. This is because, while the patent law encourages no market competition or a monopoly situation for a patented product, competition law encourages more market competition among all related products. Nonetheless, in this specific case CCI is reportedly investigating on the alleged ‘abuse of the regulatory process’, as it has opined ‘abuse of regulatory process can constitute an abuse of dominance under the (CCI) Act.’                                                                                            

The second barrier:

I am not going to discuss in this article the relevance of this barrier, in detail. Nevertheless, this one is also apparently equally tough to comply with. The very fact that none out of five biosimilar drugs approved in the United States, so far, has been considered ‘interchangeable’ by the US-FDA, vindicates the point.

That this specific regulatory demand is tough to comply with, is quite understandable from the requirements of the US-FDA in this regard, which goes as follows:

“To support a demonstration of interchangeability, the data and information submitted to FDA must show that a proposed interchangeable product is biosimilar to the reference product and that it can be expected to produce the same clinical results as the reference product in any given patient. Also, for products that will be administered more than once, the data and information must show that switching a patient back and forth between the reference product and the proposed interchangeable product presents no greater risk to the patient in terms of safety or diminished efficacy when compared to treating them with the reference product continuously.”

The reasoning of innovative biologic drug makers:

On this subject, the stand taken by different innovative drug makers is the same. To illustrate the point, let me quote just one of them. It basically sates, while biosimilar drugs are highly similar to the original medicine, the patient’s immune system may react differently due to slight differences between the two medicines when they are alternated or switched multiple times. This phenomenon, known as immunogenicity, is not a common occurrence, though. But there have been rare instances when very small differences between biologic medicines have caused immune system reactions that changed the way a medicine was metabolized, or reduced its effectiveness.

It further reiterates, the US-FDA requirements to establish ‘interchangeability’ between a biosimilar drug and the original one, or between biosimilars may seem like nuances, but are important because ‘interchangeability’ allows pharmacists to substitute biosimilars without consulting the doctor or patient first.

It may, therefore, indicate to many that innovative biologic drug manufacturers won’t want substitution of their expensive biologic with more affordable biosimilar drugs, on the ground of patient safety issues related to immunogenicity, though its instances are rather uncommon.

Some key players in biosimilar drug development:

Having deliberated on the core subject of this article, let me now very briefly name the major players in biosimilar drug development, both in the developed world, and also in India.

The first biosimilar drug was approved by the US-FDA in 2006, and the product was Omnitrope (somatropin) of Novartis (Sandoz). It was the same in the European Union (EU), as well. Subsequently, many other companies reportedly expressed interest in this field, across the globe, including Pfizer, Merck, Johnson and Johnson, Amgen, AbbVie, Hospira, AstraZeneca and Teva, among many others.

Similarly, in India, the major players in this field include, Biocon, Sun Pharma, Shantha Biotech, Dr. Reddy’s Lab, Zydus Cadila, Panacea Biotech and Reliance Life Sciences.

As featured on the Amgen website, given the complexity and cost of development and manufacturing, biosimilars are expected to be more affordable therapeutic options, but are not expected to generate the same level of cost savings as generics. This is because, a biosimilar will cost US$100 to US$200 million and take eight to ten years to develop. Whereas, a small molecule generic will cost US$1 to US$5 million and take three to five years to develop.

The market:

According to the 2017 report titled “Biosimilar Market: Global Industry Analysis, Trends, Market Size & Forecasts to 2023” of Research and Markets, the market size of the global biosimilar market was valued over US$ 2.5 billion during 2014, and it surpassed US$ 3.30 billion during 2016. The global biosimilar market is projected to surpass US$ 10.50 billion by 2023, growing with a CAGR between 25.0 percent and 26.0 percent from 2017 to 2023.

According to this report, gradually increasing awareness, doctors’ confidence and the lower drug cost are expected to boost the demand and drive the growth of the global biosimilar market during the forecast period. Segments related to diabetes medicine and oncology are expected to attain faster growth during the forecast period. Patent expiry of several blockbuster drugs is a major basic factor for growth of the global biosimilar market, as it may encourage the smaller manufacturers to consider producing such biologic drugs in those segments.

Conclusion:

Biosimilar drugs are expected to benefit especially many of those patients who can’t afford high cost biologic medicines offering better treatment outcomes than conventional drugs, in the longer term. These drugs are now being used to effectively manage and treat many chronic and life-threatening illnesses, such cardiac conditions, diabetes, rheumatoid arthritis, psoriasis, multiple sclerosis, Crohn’s disease, HIV/AIDS and cancer.

However, improving patient access to high quality biosimilar drugs, at an affordable price, with increasing competition, could be a challenge, as two key barriers are envisaged to attain this goal. Overcoming these meaningfully, I reckon, will involve choosing thoughtfully a middle path, creating a win-win situation, both for the patients, as well as the industry.

Adequate competition in the biologic drug market is essential – not only among high-priced original biologic brands and biosimilars, but also between biosimilar drugs. This is so important to increase patient access to biologic drugs, in general, across the world, including India.

The current situation demands a sense of urgency in searching for a middle path, which may be created either through a legal framework, or any other effective means as would deem fair and appropriate, without compromising with patient safety, at least, from where it is today.

By: Tapan J. Ray

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.

A Patient-Centric State Initiative To Revolutionize Disease Treatment

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In his State of the Union address, just before the recent visit to India in January 2015, President Barack Obama articulated the need to develop “Precision Medicine” in his country – a bold, giant and perhaps unprecedented State initiative to remarkably improve effectiveness of disease treatment.

To set the ball rolling, in his budget proposal for the year 2016, President Obama earmarked an amount of US$ 215 million for this purpose. This includes an allocation of US$130 million for the National Institutes of Health (NIH) to create a national research database of about a million American volunteers by studying their genetics together with other relevant factors, such as the environments they live in and the microbes that live in their bodies.

‘Precision Medicine’ initiative is similar to path breaking 13-year and US$3 billion Human Genome Project, that has formed the bedrock of modern genomics, President Obama said. He also expressed hope that the private healthcare sector too, including universities and foundations, will get involved to “lay the foundation” for this new initiative of the Government for the interest of patients.

Why is this approach so relevant in today’s healthcare?

In an article published in the ‘British Medical Journal (BMJ) in October 2012, Richard Smith - an editor of BMJ until 2004 and a Director of the United Health Group’s chronic disease initiative wrote:

“Doctors know that many of the patients they treat with drugs will not benefit. Many patients know that too.”

Dr. Smith also emphasized, for centuries medicine classified diseases by what could be seen, felt, and smelt. Thereafter, medical scientists in this area started defining diseases anatomically, physiologically, and biochemically. Even today, this is by and large the paradigm where most medicines fall.

Smith underscored, because of imprecise diagnosis the treatment also becomes haphazard. There is big variation in how individuals respond to drugs and yet that variation is not usually recorded. The regulators approve drugs based on their average performance even today.

The White House release also reiterates, most medical treatments have been designed for the “average patient.” This “one-size-fits-all-approach,” treatments can be very successful for some patients but not for others.

This calls for broadening the scope of disease treatment – from the conventional and error-prone ‘Disease Oriented’ approach, to relatively more unconventional and better targeted with greater value – ‘Patient-Centric’ ones, wherever needed.

Two current trends:

To address this key deficiency in the effective treatment of several dreaded diseases for many patients, following two are the current trends, as stated by William Pao, M.D., Ph.D., who led Roche’s Oncology Discovery & Translational Area research unit since May 2014:

  • We now know that on a molecular level every cancer is different – not only between different tumors, but even between different areas within a single tumor! This means that we need to match the right drug to the patient who we know will respond best to the drug, at the right time during the course of treatment.
  • Patients will have their tumors profiled not only for genetic drivers, but also for predictive immunotherapy markers at different time points in their course of treatment.

Personalized and Precision Medicine:

The above trends in the endeavor of making treatments more patient specific – thus more effective, have thrown open scientific discourse and intense research on ‘Personalized’ and ‘Precision’ medicines.

As Pfizer has described in its website:

Personalized Medicine is a unique approach to medical practice in which the individual aspects of a patient are directly considered to guide treatment planning, including his or her genetic make-up, key biomarkers, prior treatment history, environmental factors and behavioral preferences. This approach can be used to optimize pharmaceutical treatments and overall care.

Whereas, Precision Medicine is an approach to discovering and developing medicines and vaccines that deliver superior outcomes for patients, by integrating clinical and molecular information to understand the biological basis of disease. Precision medicine is the biopharmaceutical research and development paradigm that will help enable more patient-centered clinical practice, including treatment decision-making based on genetic information – an emerging standard now often described as “personalized medicine”.

As President Obama said while announcing the proposal on January 30, 2015, ‘Precision Medicine’ promises delivery of the right treatment at the right time, every time, to the right person.

He also said that the new effort will “bring us closer to curing diseases like cancer and diabetes…and give all of us access to the personalized information we need to keep ourselves and our families healthier.”

‘Precision Medicines’ Dominate Oncology segment: 

In the European Society for Medical Oncology (ESMO) 2014 Congress, pharma majors reported their latest advances on precision medicines in the cancer care. Bristol-Myers Squibb, Roche, AstraZeneca, GlaxoSmithKline (GSK), and Merck & Co. were among the companies presented updates of their most promising cancer drugs closer to this area.

According to a large pharma lobby group in the United States – The Pharmaceutical Research and Manufacturers of America (PhRMA):

“Recent advances in diseases such as cancer and cystic fibrosis are delivering on the promise of targeted treatments, and between 12 and 50 percent of all compounds currently being researched by the industry are potential personalized medicines. These advances hold great promise in improving patient outcomes and controlling costs by targeting the right medicines to the right patients.”

‘DCAT Connect’ Report of September 2014 also indicates significant increase in ‘Precision Medicines’ in the pipelines of the leading global pharma companies, which is a key change over the past decade.

In 2013, targeted therapies increased their share of the global oncology market, accounting for 46 percent of total sales, up from 11 percent a decade ago. According to IMS Institute for Healthcare Informatics, the global oncology drug market reached US$ 91 billion in 2013 with CAGR of 5.4 percent from 2008 to 2013.

Taking note of this trend, it appears that in the near future ‘Precision Medicines’ would possibly be the most promising class in the treatment of cancer, particularly in breast cancer, lung cancer and certain types of leukemia. This is mainly because medical scientists are already quite acquainted with the molecular signatures of different types of cancer related tumors.

Medical scientists and researchers are also working on ‘Precision Medicines’ to more effectively address many other diseases, such as, diabetes, cardiovascular and ailments related to several types of infections.

Increasing potential:

Realization of the potential of ‘Precision Medicines’ to improve care and speed the development of new treatments has just only begun to be tapped.

In recent times, scientists and researchers have accelerated efforts to understand more about biomarkers for this purpose. A study conducted by the German Association of Research-Based Pharmaceutical Companies (vfa) indicates that more than 20 percent of clinical trials carried out since 2005 focused not just on agents, but also on biomarkers. Before 1990, only one in twenty clinical trials addressed biomarkers.

According to another report, last year, 20 percent of all new drug approvals in the United States were for “Precision Medicine” treatments. This vindicates, yet again, the immense potential to turn genetic discoveries into innovative disease treatments for patients.

A bold state sponsored research initiative:

State funded, ‘Precision Medicine’ initiative is a bold new step of the American Government to revolutionize improvement in healthcare and treating disease. It is expected to pioneer a new model of patient-powered research that promises to accelerate biomedical discoveries and provide clinicians with new tools, knowledge, and therapies to select which treatments will work best for which patients.

As the White House release reiterates, most medical treatments have been designed for the “average patient.” As a result of this, “one-size-fits-all-approach” treatments can be very successful for some patients but not for others. This is changing with the emergence of ‘Precision Medicine’, an innovative approach to disease prevention and treatment that takes into account individual differences in people’s genes, environments, and lifestyles.

In this process, ‘Precision Medicine’ gives clinicians tools to better understand the complex mechanisms underlying a patient’s health, disease, or condition, and to better predict which treatments will be most effective.

Opposite view:

In an op-ed titled, ‘Moonshot’ Medicine Will Let Us Down, published recently in The New York Times, the author argued with his differing viewpoints.

I am quoting below three of those arguments:

  • “For most common diseases, hundreds of genetic risk variants with small effects have been identified, and it is hard to develop a clear picture of who is really at risk for what. This was actually one of the major and unexpected findings of the Human Genome Project. In the 1990s and early 2000s, it was thought that a few genetic variants would be found to account for a lot of disease risk. But for widespread diseases like diabetes, heart disease and most cancers, no clear genetic story has emerged for a vast majority of cases.”
  • “Another unexpected finding of the Human Genome Project was the problem of ‘missing heritability.’ While the statistics suggest that there is a genetic explanation for common conditions and diseases running in families or populations, it turns out that the information on genetic variants doesn’t explain that increased risk.”
  • “The idea behind the “war on cancer” was that a deep understanding of the basic biology of cancer would let us develop targeted therapies and cure the disease. Unfortunately, although we know far more today than we did 40-plus years ago, the statistics on cancer deaths have remained incredibly stubborn.”

I am sure, you will analyze the above points with the facts that you have at your disposal on this subject to arrive at a logical conclusion.

Current Applications:

Though these are still early days, initial benefits of ‘Precision Medicines’ have been reported in many areas, such as:

  • Genetic analysis of patients dealing with blood clots: Since 2007, the U.S. Food and Drug Administration has been recommending genotyping for all patients being assessed for therapy involving Warfarin.
  • Colorectal cancer: For colon cancer patients, the biomarker that predicts how a tumor will respond to certain drugs is a protein encoded by the KRAS gene, which can now be determined through a simple test.
  • Breast cancer: Women with breast tumors can now be effectively screened to determine which receptors their tumor cells contain.
  • Cystic fibrosis: In America, patients with a rare form of cystic fibrosis now can choose a drug designed specifically to target the genetic defect causing their illness. Specialized medical centers, such as “individualized medicine centers” at the Mayo Clinic, are also available to the patients for effective treatment.

Ethical issues:

While following this pursuit of excellence of the genetic scientists in the realm of disease treatment, some experts have reportedly raised flags of caution. They strongly feel that DNA code sequencing brings to light a “very real privacy concerns” of individuals.

GeneWatch UK is an organization that investigates how genetic science and technologies will impact on our food, health, agriculture, environment and society. They have been strongly arguing, if genome sequencing is extended to entire population, individuals and their relatives could then be identified and tracked by matching their DNA with the genome stored in the respective health records. This move, as contemplated by them, could “wipe out privacy” with an impact on the society.

Thus, the ethical and social issues in the development of ‘Precision Medicine’ primarily in the area of genetic testing need to be effectively addressed, sooner.

Conclusion:

The quest for moving away from conventional and error-prone ‘Disease Oriented Treatment’ paving the way for unconventional and value added individual patient-specific ones, may soon come to fruition.

Advances in ‘Precision Medicine’ have already led to powerful new discoveries and several new treatments that are tailored to specific characteristics of individuals, such as a person’s genetic makeup, or the genetic profile of an individual’s tumor.  This is leading to a transformation in the way the world can treat diseases such as cancer.

Patients with breast, lung, and colorectal cancers, melanomas and leukemia, for instance, should be provided with facilities in specialist hospitals to undergo molecular testing as a part of patient care, enabling physicians to select treatments that improve chances of survival and reduce exposure to adverse effects.

Although, the potential for precision medicine to improve care and speed the development of new treatments has only just begun to be tapped, some skeptics do say that tailoring medical treatments to individual characteristics of each patient is both overly optimistic and cost-prohibitive.

Be that as it may, in the balance of probability the benefits of prudent use of ‘Precision Medicine’ far outweigh the concerns expressed. This evolving new paradigm would help saving not just significant expenses, but also precious time that is usually spent on ‘trial-and-error treatments’, by enabling clinicians to determine quickly which therapies are most likely to succeed.

Though lot many grounds would still need to be covered in this area, the State sponsored ‘Precision Medicine’ initiative of America to revolutionize disease treatment, in my view, is indeed a laudable one, every way.

By: Tapan J. Ray

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.

Is The Core Purpose of Pharma Business Much Beyond Profit Making?

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Dr. Margaret Chan, the Director General of the World Health Organization (WHO), at a briefing to discuss the Ebola outbreak in West Africa at the UN Foundation in Washington on September 3, 2014 said:

“Big Pharma’s greed for profits, not lack of funding, delaying Ebola treatment development.”

Highlighting that the disease has already taken lives of 4,951 people in West Africa, Dr. Chan castigated the pharmaceutical industry for failing to develop an effective treatment for the deadly virus Ebola since 1976. “Though the Ebola crisis has become the most severe acute public health emergency seen in modern times, a profit-driven industry does not invest in products for markets that cannot pay”, Dr. Chan added.

That said, the Big Pharma has now initiated some efforts in this area, as the disease currently poses a significant threat to non-African countries, including America.

The sentiment reverberates:

Echoing similar sentiment, an article published in the BBC News on November 7, 2014 reiterated:

“Big pharma companies are in the business to make money, so will generally develop those drugs that offer the greatest potential for profit. This means a number of important drugs are neglected – the current Ebola crisis being a case in point.”

The profit oriented approach isn’t restricted just to the diseases of Africa:

The above article also points out that, besides diseases of the developing world, the Big Pharma has been slow to develop newer and multi-drug resistant antibiotics, as well.

This is mainly because, it is lot more difficult for the pharma companies to make huge quantum of profit from discovery of newer antibiotics for acute infections having limited use for around 7 to 10 days, as compared to the medicines for chronic illnesses that people will have to necessarily take every day, for life.

It appears today that the ongoing public opinion and pressure are possibly not adequate enough to trigger even a slightest change in the fetish for profit-making incentives of the Big Pharma companies.

Despite high profitability, the fetish for even more profit continues:

The pharma industry that basically exists to help saving lives of patients of all types, status and color in various ways, now seems to focus mostly on generation of more and more profit than ever before.

- The following table would vindicate the point of profitability of the industry:

Highest and Lowest Profit Margins of 5 key Industrial Sectors, 2013                        (Profit Margin in %)

No.

Sectors

Highest

Lowest

1.

Pharmaceuticals

42

10

2.

Banks

29

5

3.

Carmakers

10

3

4.

Oil & Gas

24

2

5.

Media

18

6

NB: Highest and lowest margins achieved by individual company                             (Source: Forbes, BBC News)

To generate mind boggling profits, many of the Big Pharma constituents have reportedly resorted to various types of gross misconduct and malpractices too, the Chinese saga being the tip of the iceberg.

- The following are some recent examples to help fathom the enormity of the problem:

  • In September 2014, GlaxoSmithKline was reportedly fined US $490m by China for bribery.
  • In March 2014, the antitrust regulator of Italy reportedly fined two Swiss drug majors, Novartis and Roche 182.5 million euros (U$ 251 million) for allegedly blocking distribution of Roche’s Avastin cancer drug in favor of a more expensive drug Lucentis that the two companies market jointly for an eye disorder.
  • Just before this, in the same month of March 2014, it was reported that a German court had fined 28 million euro (US$ 39 million) to the French pharma major Sanofi and convicted two of its former employees on bribery charges.
  • In November 2013, Teva Pharmaceutical reportedly said that an internal investigation turned up suspect practices in countries ranging from Latin America to Russia.
  • In May 2013, Sanofi was reportedly fined US$ 52.8 Million by the French competition regulator for trying to limit sales of generic versions of the company’s Plavix.
  • In August 2012, Pfizer Inc. was reportedly fined US$ 60.2 million by the US Securities and Exchange Commission to settle a federal investigation on alleged bribing of overseas doctors and other health officials to prescribe medicines.
  • In April 2012, a judge in Arkansas, US, reportedly fined Johnson & Johnson and a subsidiary more than US$1.2 billion after a jury found that the companies had minimized or concealed the dangers associated with an antipsychotic drug.

Many more of such instances are regularly being reported by the international media, unabated.

More profit through high drug pricing – The key argument in favor:

The Big Pharma argues that high drug pricing is absolutely necessary to generate a kind of profit, that is essential to fund heavy investments for drug innovation to meet the unmet needs of patients. Moreover, only 3 out of 10 drugs launched are profitable, on an average.

This argument really goes over the top. It does not hold much water either, as the Big Pharma reportedly spends more on the process of drug marketing than on innovation (R&D) of new drugs.

The following table would paint a different picture altogether, marketing expenditure being far more than the R&D costs: 

R&D and Marketing Spend of World’s largest Pharmaceutical Companies

Company Total Revenue (US$ Bn.) R&D Spend  (US$ Bn.) Marketing Spend (US$ Bn.) Profit (US$ Bn.) Profit Margin (%)
J & J (US) 71.3 8.2 17.5 13.8 19
Novartis (Swiss) 58.8 9.9 14.6 9.2 16
Pfizer (US) 51.6 6.6 11.4 22.0 43
Roche (Swiss) 50.3 9.3 9.0 12.0 24
Sanofi (France) 44.4 6.3 9.1 8.5 11
Merck (US) 44.0 7.5 9.5 4.4 10
GSK (UK) 41.4 5.3 9.9 8.5 21
AstraZeneca(UK) 25.7 4.3 7.3 2.6 10
Eli Lilly (US) 23.1 5.5 5.7 4.7 20
AbbVie (US) 18.8 2.9 4.3 4.1 22

(Source: GlobalData, BBC News)

Thus, it is difficult to fathom why are numbers of drugs, such as, Sovaldi and others costing as much as US $ 84,000 and above for a treatment course, when the cost of manufacturing is no more than an insignificant fraction of that treatment cost?

Considering all these and looking at the published profit and loss accounts of various pharma companies, it appears that, the line between ‘making reasonable profit’ and ‘profiteering’ is getting increasingly blurred in the pharma world.

Why is the marketing cost so high?

Since about the last decade and half, despite reasonably high expenditure on R&D there does not seem to have been many reports on breakthrough innovations. According to an expert of the World Health Organization (WHO), “of the 20 or 30 new drugs brought to the market each year, typically 3 are genuinely new, with the rest offering only marginal benefits.”

In a situation like this, when the challenge mostly is of generating targeted revenues with the new products of ‘me-too values’ rather than with those having intrinsic ‘unmet values’, marketing costs to generate doctors’ prescription would obviously escalate disproportionately. Even the process followed to generate these prescriptions, often cross the red line of regulatory, ethics and compliance standards, as have been cited above.

The following questions come up consequently:

- Are these exorbitant avoidable marketing expenditures adding any tangible or intangible values to the ultimate consumers – the patients?

- If not, why burden the patients with these unnecessary costs?

India is no different against similar parameters:

Back home in India, the deep anguish of the stakeholders over similar issues is now being increasingly reverberated with every passing day, as it were. It has also drawn the attention of the patients’ groups, NGOs, media, Government and even the Parliament.

The quality of the pharmaceutical sales and marketing process in India has touched a new low and continues to go south, causing suffering to a large number of patients. Well documented unethical drug promotion is increasingly becoming an emerging threat to the society.

Even today, the Ministry of Health and the Department of Pharmaceuticals of the Government of India provide few checks and balances on unethical drug promotion in India and prefer to keep the eyes meant for vigilance, closely shut.

Despite deplorable inaction of the government on the subject and frequent reporting by Indian media, the national debate on this issue is yet to attain a critical mass. A related Public Interest Litigation (PIL) is now pending before the Supreme Court for hearing, hopefully in the near future. Its judicial verdict is expected to usher in a breath of fresh air around a rather stifling environment for healthcare in India.

I deliberated on a similar issue in one of my earlier blog posts of September 1, 2014, titled, “Pharma And Healthcare: Mounting Trust deficit In Post Halcyon Days”

Conclusion:

While it is well-acknowledged that pharma industry has contributed immensely for the development of a large number of life saving new drugs to save precious lives all over the globe, none can also deny that for such efforts the companies concerned have not been hugely profited either…and, as we have been witnessing, not necessarily through legitimate means, always.

That said, in the backdrop of all the above examples, the core issue that emerges today as raised by many, including the World Health Organization (WHO), is the growing inherent conflict between predominantly the profit driven business goals of the pharma players and the public health interest of a nation.

Considering a number of recent serious public outbursts of the global thought leaders and also from the international media on the ‘profit dominating goals’ of the pharma industry, in general, the following questions need to be addressed with all seriousness:

- Is there a need to define afresh the core purpose of pharmaceutical business for all?

- Does the core purpose go much beyond profit making?

- If so, how would the industry plan to engage the stakeholders for its credible public demonstration?

Meanwhile, taking a serious note of it and learning from the past examples, India should initiate experts’ debate on the subject soon, to effectively resolve the conflict of two different mindsets, not resting on the same page in many ways.

By: Tapan J. Ray

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.

 

Alarming Incidence of Cancer: Fragile Infrastructure: Escalating Drug Prices

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According to the ‘Fact-Sheet 2014′ of the World Health Organization (WHO), cancer cases would rise from 14 million in 2012 to 22 million within the next two decades. It is, therefore, no wonder that cancers figured among the leading causes of over 8.2 million deaths in 2012, worldwide.

A reflection of this scary scenario can also be visualized while analyzing the growth trend of various therapy segments of the global pharmaceutical market.

A recent report of ‘Evaluate Pharma (EP)’ has estimated that the worldwide sales of prescription drugs would reach US$ 1,017 bn by 2020 with a Compounded Annual Growth Rate (CAGR) of 5.1 percent between 2013 and 2020. Interestingly, oncology is set to record the highest sales growth among the major therapy categories with a CAGR of 11.2 percent during this period, accounting for US$ 153.4 bn of the global pharmaceutical sales.

The key growth driver is expected to be an exciting new class of cancer products targeting the programmed death-1 (PD-1) pathway with a collective value of US$ 14 bn in 2020, says the report.

Another recent report from the IMS Institute for Healthcare Informatics also highlights that global oncology spending touched US$ 91 billion in 2013 growing at 5 percent annually.

Consequently, Oncology would emerge as the biggest therapeutic class, more than twice of the anti-diabetic category, which features next to it.

Key global players:

Roche would continue to remain by far the largest player in the oncology market in 2020 with a 5 percent year-on-year growth between 2013 and 2020 with estimated total sales of over US$ 34bn in 2020 against US$ 25bn in 2013.

In 2020, besides Roche, other key players in the oncology segment would, in all probability, be Bristol-Myers Squibb, Celgene, Novartis, Pfizer, Johnson & Johnson, Astellas Pharma, AstraZeneca, Eli Lilly and Merck & Co, the EP report says.

Escalating costs of cancer drugs:

As IMS Health indicates, the overall cost for cancer treatments per month in the United States has now reached to US$10,000 from US$ 5,000 just a year ago. Thus, cancer drugs are fast becoming too expensive even in the developed markets, leave aside India.

The following table would help fathom how exorbitant are the costs per therapy of the common cancer drugs, though these are from the United States:

Generic                               Diagnosis

 Cost/ Dose (US$)

Cost of     Therapy/    28 days  (US$)

Cost per  Therapy      (US$)
brentuximab Hodgkins lymphoma

14,000

18,667

224,000
Pertuzumab Breast cancer

4,000

5,333

68,000
pegylated interferon Hepatitis C

700

2,800

36,400
Carfilzomib Multiple myeloma

1,658

9,948

129,324
ziv-aflibercept CRC

2,300

4,600

59,800
Omacetaxine CML

560

3,920

50,960
Regorafenib CRC

450

9,446

122,800
Bosutinib CML

278

7,814

101,580
Vemurafenib Melanoma

172

4,840

62,915
Abiraterone Prostate

192

5,391

70,080
Crizotinib NSCLC

498

27,951

363,367
Enzalutamide Prostate

248

6,972

90,637
ado-trastuzumab emtansine Breast – metastatic

8,500

8,115

105,500
Ponatinib Leukemia

319

8,941

116,233
Pomalidomide Multiple myeloma

500

10,500

135,500

(Source: ION Solutions)

Even US researchers concerned about high cancer drugs cost:

It is interesting to note, that in a review article published recently in ‘The Lancet Oncology’, the US researchers Prof. Thomas Smith and Dr. Ronan Kelly identified drug pricing as one area of high costs of cancer care. They are confident that this high cost can be reduced, just as it is possible for end-of-life care and medical imaging – the other two areas of high costs in cancer treatment.

Besides many other areas, the authors suggested that reducing the prices of new cancer drugs would immensely help containing cancer costs. Prof. Smith reportedly said, “There are drugs that cost tens of thousands of dollars with an unbalanced relationship between cost and benefit. We need to determine appropriate prices for drugs and inform patients about their costs of care.”

Cancer drug price becoming a key issue all over:

As the targeted therapies have significantly increased their share of global oncology sales, from 11 percent a decade ago to 46 percent last year, increasingly, both the Governments and the payers, almost all over the world, have started feeling quite uncomfortable with the rapidly ascending drug price trend.

In the top cancer markets of the world, such as, the United States and Europe, both the respective governments and also the private insurers have now started playing hardball with the cancer drugs manufacturers.

There are several instances in the developed markets, including the United States, where the stakeholders, such as, National Institute for Health and Care Excellence (NICE) of the United Kingdom and American Society of Clinical Oncology (ASCO) are expressing their concerns about manufacturers’ charging astronomical prices, even for small improvements in the survival time.

Following examples would give an idea of global sensitivity in this area:

  • After rejecting Roche’s breast cancer drug Kadcyla as too expensive, NICE reportedly articulated in its statement, “A breast cancer treatment that can cost more than US$151,000 per patient is not effective enough to justify the price the NHS is being asked to pay.”
  • In October 2012, three doctors at Memorial Sloan-Kettering Cancer Center announced in the New York Times that their hospital wouldn’t be using Zaltrap. These oncologists did not consider the drug worth its price. They questioned, why prescribe the far more expensive Zaltrap? Almost immediately thereafter, coming under intense stakeholder pressure, , Sanofi reportedly announced 50 percent off on Zaltrap price.
  • Similarly, ASCO in the United States has reportedly launched an initiative to rate cancer drugs not just on their efficacy and side effects, but prices as well.

India:

  • India has already demonstrated its initial concern on this critical issue by granting Compulsory License (CL) to the local player Natco to formulate the generic version of Bayer’s kidney cancer drug Nexavar and make it available to the patients at a fraction of the originator’s price. As rumors are doing the rounds, probably some more patented cancer drugs would come under Government scrutiny to achieve the same end goal.
  • I indicated in my earlier blog post that the National Pharmaceutical Pricing Authority (NPPA) of India by its notification dated July 10, 2014 has decided to bring, among others, some anticancer drugs too, not featuring in the National List of Essential Medicines 2011 (NLEM 2011), under price control.
  • Not too long ago, the Indian government reportedly contemplated to allow production of cheaper generic versions of breast cancer drug Herceptin in India. Roche – the originator of the drug ultimately surrendered its patent rights in 2013, apprehending that it would lose a legal contest in Indian courts, according to media reports. Biocon and Mylan thereafter came out with biosimilar version of Herceptin in the country with around 40 percent lesser price.

Hence, responsible pricing of cancer drugs would continue to remain a key pressure-point  in the days ahead.

Increasing R&D investments coming in oncology:

Considering lucrative business growth opportunities and financial returns from this segment, investments of global pharma players remain relatively high in oncology, accounting for more than 30 percent of all preclinical and phase I clinical product developments, with 21 New Molecular Entities (NMEs) being launched and reaching patients in the past two years alone, according to IMS Health.

However, it is also worth noting that newly launched treatments typically increase the overall incremental survival rate between two and six months.

Opportunities for anti-cancer biosimilars:

With gradual easing out of the regulatory pathways for biosimilar drugs in the developed markets, especially in the US, a new competitive dynamic is evolving in the high priced, over US$ 40 billion, biologics market related to cancer drugs. According to IMS Health, on a global basis, biosimilars are expected to generate US$ 6 to12 billion in oncology sales by 2020, increasing the level of competition but accounting for less than 5 percent of the total biologics market even at that time.

Alarming situation of cancer in India:

A major report, published in ‘The Lancet Oncology’ states that In India, around 1 million new cancer cases are diagnosed each year, which is estimated to reach 1.7 million in 2035.

The report also highlights, though deaths from cancer are currently 600,000 -700,000 annually, it is expected to increase to around 1.2 million during this period.

Such high incidence of cancer in India is attributed to both internal factors such as, poor immune conditions, genetic pre-disposition or hormonal and also external factors such as, industrialization, over growth of population, lifestyle and food habits.

The Lancet Oncology study showed that while incidence of cancer in the Indian population is only about a quarter of that in the United States or Europe, mortality rates among those diagnosed with the disease are much higher.

Experts do indicate that one of the main barriers of cancer care is its high treatment cost, that is out of reach for millions of Indians. They also believe that cancer treatment could be effective and cheaper, if detected early. Conversely, the treatment would be more expensive, often leading to bankruptcy, if detected late and would, at the same time, significantly reduce the chances of survival too.

The fact that cancer is being spotted too late in India and most patients lack access to treatment, would be quite evident from the data that less than even 30 percent of patients suffering from cancer survive for more than five years after diagnosis, while over two-thirds of cancer related deaths occur among people aged 30 to 69.

Unfortunately, according to the data of the Union Ministry of Health, 40 percent of over 300 cancer centers in India do not have adequate facilities for advanced cancer care. It is estimated that the country would need at least 600 additional cancer care centers by 2020 to meet this crying need.

Breast cancer is the most common type of cancer, accounting for over 1 in 5 of all deaths from cancer in women, while 40 percent of cancer cases in the country are attributable to tobacco.

Indian Market and key local players:

Cancer drug market in India was reported to be around Rs 2,000 Crore (US$ 335 million) in 2013 and according to a recent Frost & Sullivan report, is estimated to grow to Rs 3,881 Crore (US$ 650 million) by 2017 with a CAGR of 15.46 percent, throwing immense business growth opportunities to pharma players.

Dr.Reddy’s Laboratories (DRL) is one of the leading Indian players in oncology. DRL has already developed biosimilar version of Rituxan (Rituximab) of Roche, Filgastrim of Amgen and has also launched the first generic Darbepoetin Alfa and Peg-grafeel.

Other major Indian players in this field are Cipla, Lupin, Glenmark, Emcure, Biocon, Ipca, Natco, Intas, Reliance Life Science, Zydus Cadila and some more. These home grown companies are expected to take a leading role in the fast growing oncology segments of India, together with the major MNC players, as named above.

Analysis of detailed opportunities that would be available to these companies and consequent financial impacts could be a subject of separate discussion.

Conclusion:

Unlike many other developed and developing countries of the world, there is no system yet in place in India to negotiate prices of innovative patented drugs with the respective manufacturers, including those used for cancer. However, NPPA is now moving fast on reducing prices of cancer drugs. It has reportedly pulled up six pharma for not providing pricing data of cancer drugs sold by them.

Further, CL for all patented anti-cancer drugs may not be a sustainable measure for all time to come, either. One robust alternative, therefore, is the intense price negotiation for patented drugs in general, including anti-cancer drugs, as provided in the National Pharmaceutical Pricing Policy 2012 (NPPP 2012).

This important issue has been under consideration of the Department of Pharmaceuticals (DoP) since 2007. The report produced by the committee formed for this specific purpose, after dilly-dallying for over five years, now hardly has any takers and gathering dusts.

I reckon, much discussed administrative inertia, insensitivity and abject lack of sense of urgency of the previous regime, have desisted the DoP from progressing much on this important subject, beyond of course customary lip services, as on date. Intense lobbying by vested interests from across the world, seems to have further helped pushing this envelope deep inside an inactive terrain.

The new Government would hopefully make the DoP break its deep slumber now to resolve this critical issue decisively, in a time bound manner, assigning clear accountability, without any further delay.

At the same time, shouldn’t both the Honorable Ministers of Health and Chemicals & Fertilizers, taking the State Governments on board, put their collective resources together to create the following, expeditiously:

- A robust national health infrastructure for cancer care

- A transparent mechanism to prevent escalating cancer drug prices and other treatment costs

Hope, the good days would come to the cancer patients of India, at least, sooner than never.

By: Tapan J. Ray

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion. 

“Kickbacks And Bribes Oil Every Part of India’s Healthcare Machinery” – A National Shame?

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“Corruption ruins the doctor-patient relationship in India” - highlights an article published in the well-reputed British Medical Journal (BMJ) on 08 May 2014. The author David Berger wrote, “Kickbacks and bribes oil every part of the country’s healthcare machinery and if India’s authorities cannot make improvements, international agencies should act.”

The author reiterated the much known facts that the latest in technological medicine is available only to those people who can pay for its high price. However, the vast majority of the population has little or no access to healthcare, and whatever access they have is mostly limited to substandard government care or to quacks, which seem to operate with near impunity. He further points out that “Corruption is rife at all levels, from the richest to the poorest”. It is a common complaint both from the poor and the middle class that they don’t trust their doctors from the core of hearts. They don’t trust them to be competent or to be honest, and live in fear of having to consult them, which results in high levels of doctor shopping.

Dr. Berger also deliberated on the widespread corruption in the pharmaceutical industry, with doctors bribed to prescribe particular drugs. Common stories usually doing the rounds that the decision makers in the hospitals are being given top of the range cars and other inducements when their hospitals sign contracts to prescribe particular expensive drugs preferentially.

The article does not fail to mention that many Indian doctors do have huge expertise, are honorable and treat their patients well. However, as a group, doctors generally have a poor reputation.

Until the profession along with the pharma industry is prepared to tackle this malady head-on and acknowledge the corrosive effects of medical corruption, the doctor-patient relationship will continue to lie in tatters, the paper says.

The saga continues through decades – unabated:

The above worrying situation in the space of medical treatment in India refuses to die down and continues since decades.

The article published in the British Medical Journal (BMJ) over a decade ago, on January 04, 2003 vindicates this point, when it brings to the fore, “Health care is among the most corrupt services in India”.

This article was based on a survey released by the India office of the international non-governmental organization ‘Transparency International’. At that time, it ranked India as one of the 30 most corrupt countries in the world. The study covered 10 sectors with a direct bearing on people’s lives, where the respondents rated the police as the most corrupt sector, closely followed by healthcare.

Medical Council of India (MCI) is responsible for enforcing the regulations on medical profession. Unfortunately, the MCI itself is riddled with corruption, fueled by the vested interests. As the first BMJ article indicates,   Subsequently, there has been controversy over the surprise removal, on the day India was declared polio-free, of the health secretary Keshav Desirajus, possibly in response to his resistance to moves to reappoint Desai to the reconstituted MCI.

Another point to ponder: Quality of Doctor – MR interactions

It is a well-established fact that the ethics, values and belief in pharmaceutical sales and marketing are primarily derived from the ethics, values and belief of the concerned organization.  Field staff systems, compliance, accountability, belief, value and culture also flow from these fundamentals. Thus, considering the comments made in the BMJ on the pharma companies, in general, let me now also deliberate on the desired roles of the Medical Representatives (MR) in this area.

It is well known that MRs of the pharma players exert significant influence on the prescribing practices of the doctors and changing their prescribing patterns too. At the same time, this is also equally true that for a vast majority of, especially, the General Practitioners (GPs), MRs are the key source of information for various drugs. In tandem, several research studies also indicate that doctors, by and large, believe that pharma companies unduly influence them.

Theoretically, MRs should be properly trained to convey to the target doctors the overall profile – the efficacy, safety, utility, precautions and contra-indications of their respective products. Interestingly, the MRs are trained by the respective pharma companies primarily to alter the prescribing habits of the target doctors with information heavily biased in favor of their own drugs.

As a result, range of safety, precautions and contra-indications of the products are seldom discussed, if not totally avoided, putting patients at risks by creating an unwarranted product bias, especially among GPs, who depend mainly on MRs for product information. Thus, the quality of product communication is mainly focused on benefits rather than holistic – covering all intrinsic merits/demerits of the respective brands in a professional manner.

Considering the importance of detailing in delivering the complete product information primarily to the GPs, there is a critical need for the pharma companies to train and equip the MRs with a complete detailing message and yet be successful in winning the doctors’ support.

This issue also needs to be properly addressed for the interest of patients.

“Means” to achieve the goal need to change: 

Globally, including India, many pharma players have not been questioned, as yet, just not on the means of their meeting the financial goals, but also the practices they follow for the doctors. These often include classifying the physicians based on the value of their prescriptions for the specific products. Accordingly, MRs are trained to adopt the respective companies’ prescribed ‘means’ to influence those doctors for creating a desirable prescription demand. These wide array of so-called ‘means’, as many argue, lead to alleged ‘bribery’/’kickbacks’ and other malpractices both at the doctors’ and also at the pharma companies’ end.

To address this issue, after the Chinese episode, GlaxoSmithKline (GSK) has reportedly announced that by the start of 2016 it will stop paying doctors to speak on its behalf or to attend conferences, to end undue influence on prescribers.

The announcement also indicated that GSK has planned to remove individual sales targets from its sales force. This means that MRs would no longer be paid according to the number of prescriptions they solicited from the doctors met by them.

Instead, GSK introduced a new performance related scheme that will reward the MRs for their technical knowledge, the quality of the service they deliver to support improved care of patients, and the overall performance of GSK’s business. The scheme is expected to start in some countries effective January 2014 and be in place globally by early 2015.

Further, GSK underscored that the latest changes were “designed to bring greater clarity and confidence that whenever we talk to a doctor, nurse, or other prescriber, it is patients’ interests that always come first.”

This is indeed a refreshing development for others to imbibe, even in India.

Capturing an Indian Example:

Just to cite an example, a couple of years ago Reuters in an article titled “In India, gift-giving drives drug makers’ marketing” reported that a coffee maker, cookware and vacuum cleaner, were among the many gifts for doctors listed in an Abbott Healthcare sales-strategy guide for the second quarter of 2011 in India, a copy of which was reviewed by Reuters.

It is interesting to note from the report, even for an antibiotic like Nupod (Cefpodoxime), doctors who pledge to prescribe Abbott’s branded drugs, or who’ve already prescribed certain amounts, can expect some of these items in return, the report mentioned.

Since decades, media reports have highlighted many more of such instances. Unfortunately, the concerned government authorities in India refused to wake-up from the deep slumber, despite the alleged ruckus spreading like a wild fire.

Self-regulation by the industry ineffective:

This menace, though more intense in India, is certainly not confined to the shores of this country. As we all know, many constituents of Big Pharma have already been implicated in the mega pharma bribery scandal in China.

Many international pharmaceutical trade associations, which are primarily the lobbying bodies, are the strong votaries of self-regulations by the industry. They have also created many documents in these regards since quite some time and displayed those in their respective websites. However, despite all these the ground reality is, the charted path of well-hyped self-regulation by the industry to stop this malaise is not working.

The following are just a few recent examples to help fathom the enormity of the problem and also to vindicate the above point:

  • In March 2014, the antitrust regulator of Italy reportedly fined two Swiss drug majors, Novartis and Roche 182.5 million euros (U$ 251 million) for allegedly blocking distribution of Roche’s Avastin cancer drug in favor of a more expensive drug Lucentis that the two companies market jointly for an eye disorder.
  • Just before this, in the same month of March 2014, it was reported that a German court had fined 28 million euro (US$ 39 million) to the French pharma major Sanofi and convicted two of its former employees on bribery charges.
  • In November 2013, Teva Pharmaceutical reportedly said that an internal investigation turned up suspect practices in countries ranging from Latin America to Russia.
  • In May 2013, Sanofi was reportedly fined US$ 52.8 Million by the French competition regulator for trying to limit sales of generic versions of the company’s Plavix.
  • In August 2012, Pfizer Inc. was reportedly fined US$ 60.2 million by the US Securities and Exchange Commission to settle a federal investigation on alleged bribing of overseas doctors and other health officials to prescribe medicines.
  • In April 2012, a judge in Arkansas, US, reportedly fined Johnson & Johnson and a subsidiary more than US$1.2 billion after a jury found that the companies had minimized or concealed the dangers associated with an antipsychotic drug.

Pricing is also another important area where the issue of both ethics and compliance to drug regulations come in. The key question continues to remain, whether the essential drugs, besides the patented ones, are priced in a manner that they can serve the needs of majority of patients in India. I have deliberated a part of this important issue in my earlier blog post titled “Is The New Market Based Pricing Model Fundamentally Flawed?”

There are many more of such examples.

Stakeholders’ anguish:

Deep anguish of the stakeholders over this issue is now being increasingly reverberated on every passing day in India, as it were. It had also drawn the attention of the patients’ groups, NGOs, media, Government, Planning Commission and even the Parliament.

The Department Related Parliamentary Standing Committee on Health and Family Welfare in its 58th Report strongly indicted the Department of Pharmaceuticals (DoP) on this score. It observed that the DoP should take prompt action in making the ‘Uniform Code of Pharmaceutical Marketing Practices (UCPMP)’ mandatory so that effective checks and balances could be brought-in on ‘huge promotional costs and the resultant add-on impact on medicine prices’.

Despite deplorable inaction by the erstwhile Government on the subject, frequent reporting by Indian media has triggered a national debate on this issue. A related Public Interest Litigation (PIL) is also now pending before the Supreme Court for hearing in the near future. Its judicial verdict is expected to usher in a breath of fresh air around a rather stifling environment for the patients.

Let us now wait and see what action the new minister of the Modi Government takes on this issue.

A prescription for change:

Very recently, Dr. Samiran Nundy, Chairman of the Department of Surgical Gastroenterology and Organ Transplantation at Sir Ganga Ram Hospital and Editor-in-Chief of the Journal of Current Medicine Research and Practice, has reportedly exposed the widespread (mal) practices of doctors in India taking cuts for referrals and prescribing unnecessary drugs, investigations and procedures for profit.

Dr. Nundy suggested that to begin with, “The Medical Council of India (MCI), currently an exclusive club of doctors, has to be reconstituted. Half the members must be lay people like teachers, social workers and patient groups like the General Medical Council in Britain where, if a doctor is found to be corrupt, he is booted out by the council.”

Conclusion:

Efforts are now being made in India by some stakeholders to declare all malpractices related to pharma industry illegal through enactment of appropriate robust laws and regulations, attracting exemplary punishments to the perpetrators.

However, enforcement of MCI Guidelines for the doctors and initiatives towards enactment of suitable laws/regulations for the pharma industry, like for example, the ‘Physician Payments Sunshine Act’ of the United States, have so far been muted by the vested interests.

If the new Modi government too, does not swing into visible action forthwith, this saga of international disrepute, corruption and collusion in the healthcare space of India would continue in India, albeit with increasing vigor and probably in perpetuity. This would, undoubtedly, sacrifice the interest of patients at the altar of excessive greed and want of the vested interests.

This new government, as most people believe, has both the will and wherewithal to hold this raging mad bull of pharma malpractices by the horn, ensuring a great relief and long awaited justice for all.

By: Tapan J. Ray

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.